ICO Guide

An Initial Coin Offering (ICO), is a revolutionary way of digital crowdfunding which has a similar concept to Kickstarter, but accepts only digital currencies known as cryptocurrencies instead of traditional fiat money.

​In return for contributing cryptocurrencies such as Bitcoin or Ethereum to the company, investors receive new, specially-minted digital tokens. Token holders are then able to trade them as speculative currency, or hold on to them for future rewards on the online blockchain network.

Steps to prepare for an ICO / Token Sale

1) Getting Cryptocurrencies to contribute

To take part in ICOs, you first need to own at least some ETH or BTC, as most ICOs accept those as payment.

You purchase ETH and BTC through these exchanges, and the coins are stored in your Exchange wallet address.

2) Sending your Cryptocurrencies to secure, private wallets

You will then need to transfer your ETH or BTC from the Exchange address to good, secure cryptowallet platforms.

DO NOT participate in token sales by sending cryptocurrencies from your Exchange wallet account (eg. Coinbase)! Especially for Ethereum-based ICOs, exchanges wallets are not ERC-20 token compatible and you may lose your tokens after participating.

Instead, send ETH or BTC from your exchange into MyEtherWallet (MEW) or Metamask or Parity or Jaxx - wallets where you own and control your private key. For Ethereum-based ICOs, we recommend the wallets MEW or Metamask.

With your capital now in your secure wallets, you can start to prepare to contribute to the ICO of your choice.

3) Learn about transaction costs

For Ethereum-based transactions, learn what is Gas Price (Gwei), and what is Gas Limit. Gas Price helps your transaction go faster on the Ethereum blockchain, while Gas Limit is the amount of Gas required to ensure the transaction is successful. Extra Gas not needed for the transaction will be returned. A product of Gwei and Gas Limit will be the estimated cost of your Ethereum transaction.

Typically, most ICOs will release a token address on the specified time and date of the crowdsale. You can send your desired amount of BTC or ETH to the company's token address from your BTC or ETH wallet.

Be sure that the address you received is accurate. Make sure you copy & paste the address accurately.

Always check multiple official sources from the company prior to the ICO.

Depending on the company, the contribution period might be a few days, a few months, or even an entire year. Most ICOs allow an unlimited amount of contribution, but sometimes for very popular ones each investor has an individual fixed cap, and cannot contribute more than that amount - to ensure a greater number of token holders and hence a larger community. KyberNetwork's ICO for example, had an oversubscribed whitelist, and an individual cap of only 3.2 ETH.

Over 1 year, we have developed a robust weighted average scoring system of multiple elements to judge the value of a project and its token. For ICOs, we have a separate scoring system for flipping as well. This weighted average scoring system has been tested and fine-tuned through the crucible of over 30 ICOs - some as strong investments, some as punts - and we believe it is now an extremely strong indicator for long term 'hodl' potential.

These multiple elements can be grouped into a few key categories, namely: